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	<title>
	Comments on: The End Of The Beginning?	</title>
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	<description>The repository of one hard-boiled egg from the south suburbs of Milwaukee, Wisconsin (and the occassional guest-blogger).  The ramblings within may or may not offend, shock and awe you, but they are what I (or my guest-bloggers) think.</description>
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		<title>
		By: Shoebox		</title>
		<link>https://norunnyeggs.com/2009/04/the-end-of-the-beginning/comment-page-1/#comment-37229</link>

		<dc:creator><![CDATA[Shoebox]]></dc:creator>
		<pubDate>Wed, 01 Apr 2009 22:59:26 +0000</pubDate>
		<guid isPermaLink="false">https://norunnyeggs.com/?p=5374#comment-37229</guid>

					<description><![CDATA[The companies will definitely use their judgement.  The issue is that the auditors have not allowed them to do so and have used a strict interpretation of the FASB.  The last time they tried to do this, FASB tried to say &quot;oh, no, you can use other methods&quot; but didn&#039;t change the promulgation so auditors didn&#039;t budget.  This time I fully expect there to be explicit language changes.  If that happens, this will be very significant to earnings and not just a feel good.  The question then is does reality bear out the estimates or are there surprises in the future.  My guess is that public companies will not take this all back at once.  They will hold a significant amount in reserve.  If they just don&#039;t have to write anymore off, most of these institutions will have positive income.  The last question will be how much capital pressure do they have that may cause them to inflate more than not?]]></description>
			<content:encoded><![CDATA[<p>The companies will definitely use their judgement.  The issue is that the auditors have not allowed them to do so and have used a strict interpretation of the FASB.  The last time they tried to do this, FASB tried to say &#8220;oh, no, you can use other methods&#8221; but didn&#8217;t change the promulgation so auditors didn&#8217;t budget.  This time I fully expect there to be explicit language changes.  If that happens, this will be very significant to earnings and not just a feel good.  The question then is does reality bear out the estimates or are there surprises in the future.  My guess is that public companies will not take this all back at once.  They will hold a significant amount in reserve.  If they just don&#8217;t have to write anymore off, most of these institutions will have positive income.  The last question will be how much capital pressure do they have that may cause them to inflate more than not?</p>
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		<title>
		By: steveegg		</title>
		<link>https://norunnyeggs.com/2009/04/the-end-of-the-beginning/comment-page-1/#comment-37228</link>

		<dc:creator><![CDATA[steveegg]]></dc:creator>
		<pubDate>Wed, 01 Apr 2009 21:38:42 +0000</pubDate>
		<guid isPermaLink="false">https://norunnyeggs.com/?p=5374#comment-37228</guid>

					<description><![CDATA[It will have mainly a psychological effect rather than an actual balance-sheet one.  Do note the third paragraph of the Marketwatch story:
&lt;blockquote&gt;FASB has already provided auditors with flexibility in how they can value illiquid assets; however, accounting firms have been averse to employ such authority for fear of liability. The FASB guidance would allow bank auditors to use &quot;significant judgment&quot; when valuing the illiquid assets for which they don&#039;t believe they will be able to collect all the amounts due.&lt;/blockquote&gt;
Given those that vilified Arthur Andersen are the ones in complete control, what company, other than those already effectively run by the government (e.g. Citigroup), will actually use their &quot;significant judgment&quot;?  Indeed, after the end of the month, will even those companies use their &quot;significant judgment&quot;?]]></description>
			<content:encoded><![CDATA[<p>It will have mainly a psychological effect rather than an actual balance-sheet one.  Do note the third paragraph of the Marketwatch story:</p>
<blockquote><p>FASB has already provided auditors with flexibility in how they can value illiquid assets; however, accounting firms have been averse to employ such authority for fear of liability. The FASB guidance would allow bank auditors to use &#8220;significant judgment&#8221; when valuing the illiquid assets for which they don&#8217;t believe they will be able to collect all the amounts due.</p></blockquote>
<p>Given those that vilified Arthur Andersen are the ones in complete control, what company, other than those already effectively run by the government (e.g. Citigroup), will actually use their &#8220;significant judgment&#8221;?  Indeed, after the end of the month, will even those companies use their &#8220;significant judgment&#8221;?</p>
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